Outlook for college graduates mixed

Economists say health, engineering fields still have employment edge

By Rachelle Kredentser

Published 7:34 pm, Thursday, June 27, 2013

Joining the labor force has always been an adjustment for college graduates, but in the years since the recession hit, recent graduates have found it even harder to find appropriate jobs, New York Federal Reserve officials said at a news conference Thursday.

The regional presentation focused on the labor market for recent college graduates and the choice to attend college.

William C. Dudley, president and CEO of the Federal Reserve Bank of New York, discussed the troubles and successes in the economy that are affecting the labor market, especially for recent college graduates. Spending on consumer goods is returning to more normal levels, as spending on durable goods, such as cars, continues to increase, he said. The housing market seems to "have worked off the excess supply of housing built up during the boom years of the last decade," Dudley added.

More Information

However, he also noted that as international economic growth has slowed, the demand for U.S. exports has declined, leading to less demand in the U.S. labor market. As private sector employment remains relatively stable, the decrease in employees needed in the manufacturing and government sectors adds to the struggle of America's recovering labor market, he said.

While New York state's economic situation improves, Dudley and economists speaking at the event said the problem for recent college graduates is not just one of unemployment, but also of underemployment, meaning when someone's job is lower than their skill set or degree.

Still, they defended college education, citing that whether employed or underemployed, those with college degrees tend to have higher salaries when compared to those in the same position who lack a college education.

They pointed out that some college majors do better than others at landing jobs. Students majoring in engineering, education and health subjects, for instance, tend to be those most employed in their fields in jobs that require a bachelor's degree. Careers in engineering tend to have the highest wages.

There is hope that economic growth will become more stable and regular, Dudley said, but as outlooks on markets change, the Fed will adjust its policies accordingly.

Schooling is still recommended, Federal Reserve economists reaffirmed, and those who want better labor market conditions should major in a field that will serve well for emerging or growing parts of the economy.